NATS-Annual-Report-2015

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Annual Report and Accounts 2015 | NATS Holdings Limited Financial Statements 138 Notes forming part of the consolidated accounts (continued) 27. Share based payments The company operates an All-Employee Share Ownership Plan for the benefit of employees to hold 5% of the share capital of the company. The plan is administered by NATS Employee Sharetrust Limited. The scheme allows for free shares, dividend shares, partnership shares and matching shares to be awarded to employees. The free shares and matching shares have a vesting period of three years from date of award and may be cash-settled from this date. The shares may be forfeited if the employee leaves within three years of the date of the award, depending on conditions of departure. A liability is recognised for the current fair value of shares in issue at each balance sheet date. Changes in fair value of the liability are charged or credited to the income statement. The number of shares outstanding at the balance sheet date was: Date of share awards No. shares awarded to employees No. employee shares outstanding at 31 March 2015 No. employee shares outstanding at 31 March 2014 Free share awards 21 September 2001 3,353,742 376,757 443,320 20 October 2003 2,459,000 353,218 414,934 10 September 2004 1,966,000 546,818 661,039 11 January 2008 1,071,840 444,100 550,080 18 September 2009 963,200 527,371 738,820 Partnership shares 1 March 2011 694,783 568,408 611,041 1 September 2012 714,959 628,257 672,112 30 May 2014 496,738 466,750 - Matching shares 1 March 2011 694,783 572,260 611,041 1 September 2012 714,959 628,257 672,112 30 May 2014 496,738 466,750 - 5,578,946 5,374,499 Dividend shares issued on 28 June 2005 247,017 45,306 52,978 Total employee shares in issue at 31 March 5,624,252 5,427,477 The movement in the number of employee shares outstanding is as follows: Movement in the no. of shares during the year ended 31 March 2015 Movement in the no. of shares during the year ended 31 March 2014 Balance at 1 April 5,427,477 5,851,028 Granted during the year 993,476 - Forfeited during the year (11,943) (9,443) Exercised during the year (784,758) (414,108) Balance at 31 March 5,624,252 5,427,477 These shares are valued every six months by independent valuers using discounted cash flow and income multiple methods of valuation. As at 31 March 2015 the price of an employee share was valued at £4.30 (2014: £4.50). A valuation at 30 June 2014 valued the shares at £4.35. The liability on the balance sheet for the employee shares at 31 March 2015 was £21.8m (2014: £21.7m) included in other accruals and deferred income. The payments made to employees for the shares they exercised during the year was £3.4m (2014: £1.7m). Financial Statements
Annual Report and Accounts 2015 | NATS Holdings Limited Financial Statements 139 Notes forming part of the consolidated accounts (continued) 28. Retirement benefit schemes Defined contribution scheme The group provides a defined contribution scheme to all qualifying employees who are not members of the defined benefit scheme. The assets of the scheme are held separately from those of the group in funds under the control of a board of Trustees. The group operates a salary sacrifice arrangement whereby employees sacrifice an element of their salary in favour of contributions to the pension scheme. NATS operates a number of contribution structures. In general, NATS matches employee contributions to the scheme in a ratio of 2:1, up to a maximum employer contribution of 18%. For the year ended 31 March 2015 employer contributions of £5.0m (2014: £3.9m), excluding employee salary sacrifice contributions of £2.4m (2014: £2.0m), represented 14.1% of pensionable pay (2014: 13.6%). The defined contribution scheme had 737 members at 31 March 2015 (2014: 672). Defined benefit scheme NATS Limited (formerly National Air Traffic Services Limited), the company’s wholly-owned subsidiary, entered into a deed of adherence with the CAA and the Trustees of the Civil Aviation Authority Pension Scheme (CAAPS) whereby the company was admitted to participate in CAAPS from 1 April 1996. CAAPS is a fully funded defined benefit scheme providing benefits based on final pensionable salaries. At 31 March 2001, the business of NATS was separated from the CAA. As a consequence, NATS became a ‘non associated employer’ which requires the assets relating to the liabilities of NATS active employees at 31 March 2001 to be separately identified within the CAAPS. CAAPS was divided into two sections to accommodate this, namely the CAA section and the NATS section, and a series of common investment funds was established in which both sections participate for investment purposes. The assets and membership of the scheme prior to transfer were allocated between these sections in accordance with Statutory Instrument 2001 Number 853, Transport Act 2000 (Civil Aviation Authority Pension Scheme) Order 2001. The assets of the scheme are held in a separate trustee administered fund. CAAPS is governed by a board of Trustees which is responsible for implementing the funding and investment strategy. The board comprises 6 employer (NATS and CAA) and 6 member-nominated trustees, as well as an independent chairman. During 2009 the group introduced a number of reforms to manage the cost and risk of pensions. The defined benefit pension scheme was closed to new joiners with effect from 31 March 2009. In addition, from 1 January 2009, annual increases in pensionable salaries were limited to a maximum increase in the retail prices index (RPI) plus 0.5%. A defined contribution scheme was also introduced for new joiners (see above). Finally, pension salary sacrifice arrangements were introduced with effect from 1 April 2009. During 2013 the group consulted on further pension reforms to mitigate rising pension costs. These included a change to the limit on annual increases in pensionable salaries to a maximum of the consumer prices index (CPI) plus 0.25%. In addition, the Trustees consulted members of the scheme on a change to the indexation of future service at CPI, rather than RPI. These reforms were agreed by staff. The defined benefit scheme had the following membership at 31 March: 2015 2014 No. No. Active members 3,477 3,711 Deferred members 1,157 1,089 Pensioners 2,308 2,154 6,942 6,954 Financial Statements
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NATS-Annual-Report-2015

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